Apple cuts production orders of new iPhones

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Apple cuts production orders of new iPhones

Apple has reduced production orders for all three of its 2018 iPhone models, including repeated reductions for its most affordably priced model, the iPhone XR, according to a report.

Apple again reduced orders for the iPhone XR in the past week, after initially slashing the iPhone XR orders by as much as one-third of the original 70 million unit order in late October, according to the report in The Wall Street Journal.

The report said that Apple has also reduced orders for its two higher-priced models, the iPhone XS and iPhone XS Max—which feature OLED displays, in contrast to the iPhone XR's LCD display.

Apple did not immediately respond to a request for comment.

Apple's stock price had fallen about 3 percent as of midmorning Monday, to US$187.62 a share. That's down from the closing price of US$222.22 just before Apple reported its fourth fiscal quarter earnings on 1 November, representing a drop of 15.5 percent.

The Wall Street Journal reported that demand for all three of the new iPhones has been lower than expected. The iPhone XR had been forecast by analysts to be the most popular model in the new iPhone lineup—thanks to its starting price of US$1299 (compared with the $1629 iPhone XS and $1799 iPhone XS Max) and its 6.1-inch display (larger than the 5.8-inch iPhone XS).

Forecasting iPhone demand has become more difficult since Apple began offering three new models per year—compared with the usual two that Apple put out annually prior to 2017—and as a result of the higher pricing levels, according to The Wall Street Journal.

The report said Apple's move to end the disclosure of unit sales data for the iPhone has also complicated matters for the company's suppliers.

The end of reporting on unit sales comes just as Apple is generating little growth in units in its iPhone business. In its fourth fiscal quarter, ended 19 September, Apple sold 46.9 million iPhone units. That represented a less than 1 percent increase from the same period a year earlier, when 46.7 million iPhone units were sold.

However, revenue for its iPhone business jumped 28.9 percent during the fourth fiscal quarter, reaching US$37.19 billion. That increase came thanks to the higher prices now charged for new iPhones.

Overall for the fourth fiscal quarter, Apple reported revenue of US$62.9 billion, up 19.6 percent from US$52.58 billion a year earlier.

This article originally appeared at crn.com

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